From Traderpedia

Definition: A certain price of an instrument where a trader with a position in that instrument would accept that he was wrong and/or does not wish to risk further losses and wishes to exit an open trade at a loss.

Stop losses can be mental, meaning when the price level is hit the trader must effect an exit manually, probably with a market order or they can be stop orders in the market, either simulated or native. A simulated stop order is transmitted to the exchange as a market order when a certain level is touched or traded, usually by the trader's software trading platform, whereas a native order is held at the exchange and will be executed immediately when the price level is touched or traded.